“Raising the wage is a top priority for Democrats going into the 2014 Legislative session. Last year the Minnesota House passed a bill to raise the wage to $9.50. The Senate passed a bill to raise it to $7.75 but lawmakers were unable to agree on a compromise. DFL Gov. Mark Dayton says he supports the $9.50 level,” writes MPR News reporter Mark Zdechlik.

Minnesota restaurant owners say raising the state’s minimum wage to $9.50 an hour would hurt their businesses and cost some of their employees their jobs.

Restaurants will spend money on technology to reduce wait staff if they have to pay a higher minimum wage, Doug Sams, founder of D. Brian’s Deli, said Tuesday. Customers will also pay more, he added.

Sams spoke to reporters at Murray’s steakhouse in Minneapolis as part of the Minnesota Restaurant Association’s effort to stop a wage hike bill.

A proposed federal minimum wage hike could spell the loss of 500,000 jobs according to the Congressional Budget Office.

Related Questions

No. By raising the price of something, you reduce the demand for it. The effect, according to the study noted below, has a disproportionate impact on minorities – specifically black males age 16-24. An excerpt:

Drs. Even and Macpherson focus on 16-to-24 year-old males
without a high school diploma, a group that previous studies
suggest are particularly susceptible to wage mandates. Among
white males in this group, the authors find that each 10 percent
increase in a federal or state minimum wage decreased employment
by 2.5 percent; for Hispanic males, the figure is 1.2 percent.
But among black males in this group, each 10 percent increase in
the minimum wage decreased employment by 6.5 percent.

To the extent that any employers still had excess staffing, it was likely cut during the last recession, so further cutting after a minimum wage increase is unlikely. However, raising the minimum wage gives people earning that wage more spending power, which increases consumer demand, which should mitigate the losses employers may face from having to pay a higher wage to their workers.

Lisa H.

I am conflicted about raising the minimum wage. There are people who spend a lot of money on post-secondary education starting out at $10-$12/hour. Then there are people who have chosen NOT to further their education & they stay at $7.50 +/- pushing brooms, changing beds, washing windows & working the cash register, etc. To me, that is fair. I think merit needs to play a part in the pay we receive. I agree that people should be able to live, work & support their families, but I also believe in birth control, education & hard work. Everything boils down to the choices we make.

Jamie

Less than 1% of American workers 30 or older earn at or below minimum wage, and the majority of those work in restaurants and bars where they get tips.

No, it just means that we will start seeing more self service kiosks at all the fast food and retail stores like they have at CVS and Home Depot.

It means that all employers will push their wages up at most pay levels to attract a higher grade worker that the minimum wage worker. If the company can raise their price and people still buy their goods and services, it becomes inflationary, because now the people who got a raise will be paying more for goods and services at a higher price, thus making their increase really not an increase. Or, businesses will have to lay people off or automate their process, thus killing job opportunities.

Feel good legislation with an apparent lack of basic economics, but it feels good.

JQP

Actually , I think all of the various negative responses you cite will occur regardless of wages. Certain jobs are getting replaced automation or non-human interaction already.

Humans , however , are required to pay for food, shelter and clothing.
Its simply Ostrichian to suggest that lower wages support the necessary simple expenses of the bottom of the barrel waged workers.

Its also categorically proven the the vst majority of business owners won’t pay their employees more to address this income shortfall to support living-expenses. You, I believe , would state that the employer has absolutely no concern about the employee once he leaves the job site.

Gordon near Two Harbors

Do these “basic economics” only apply to the United States? It seems like Germany and the Scandinavian countries are able to require “living wages” and their companies are thriving.

Their people all have health insurance, excellent and cost-effective health care–and a longer life expectancy as well.

The American answer is to keep wages so low that millions of workers are forced to depend on the government (taxpayer) to make ends meet. The wage disparities keep increasing, and America is burning its candle at both ends.

David

$10.10 is still a weak compromise coming from scarcity consciousness. $15-20 would be a more appropriate minimum hourly wage.
Better than minimum wage would be minimum income or rather Universal Basic Income advocated by the wise from Bertrand Russell to Milton Friedman.http://en.m.wikipedia.org/wiki/Basic_income

☆ Think plenitude ♡

JQP

Yes I do ….
but I’d like to see the mechanism tied to economic behavior. I think the process of making it a political decision every couple of years is ludicrous.

Neither business nor employees can tolerate the pandering, gibberous, buffonery that introduces bizarre and unexpected twists into the outcome.

Businesses and employees should be able to look in the paper at the same economic results and understand what will happen. congress and the legislature retain to much granular control over far too widespread and diverse an issue.

Think “plenitude” and thanks as you do your best repealing the prohibition of cannabis/hemp.

Rich in Duluth

Yes, raising the minimum wage and indexing it to inflation is a good short term tactic. However, this will certainly eliminate jobs through automation or putting more responsibility on fewer workers.

For a long term solution to low wages, raising the minimum wage should be coupled with increases in education funding. That funding should be targeted at education that prepares people for future, well paying, jobs, such as jobs in engineering, medicine, science, construction, etc.

Gary F

Do government employee unions like MAPE and AFSCME get an automatic pay increase when the minimum wage goes up?

If yes, this is just more payback for union campaign donations, right?

reggie

Gary, given your general views in this forum, you ought to be all over a minimum wage increase as a way to reduce the number of people on welfare. Maybe if we stop subsidizing the thousands (tens of thousands?) of WalMart and McDonald’s workers getting the current minimum wage, we will see a miraculous transformation as people rise up out of poverty and go on to become Republicans. (Then again, maybe not.)

Sue de Nim

Yes. And, it should have a clause that requires it to match the federal minimum wage if that ever goes higher than Minnesota’s, and it should be indexed to inflation.

James

Fine by me. It is much ado about nothing. Very few people will be impacted. The few impacted employees will go from starving to just hungry. Impacted businesses will adjust appropriately. Prices will have to go up or staffing down at the big offenders (McDonalds, Subway and WalMart.)

Jim G

Yes, the minimum wage has not kept up with inflation. When I started popping popcorn at the Target snack bar in 1968 the minimum wage was $1.60. The minimum wage of $1.60 an hour in 1968 would be $10.56 today when adjusted for inflation [see the Bureau of Labor Statistics’ Consumer Price Index inflation calculator. No wonder I could afford to pay for college expenses, rent, transportation, and food while working part-time 16 to 23 hours a week. Raise the minimum to $9.50 and index it to inflation. Today’s hourly rates are worth less. Work needs to be worth more, like it was during my youth.

PaulJ

Yes, how else can those on the lowest rung get a raise. If people can’t afford to pay them then they can’t afford to run a business and those forced into unemployed will have to live off the taxes of wealthy. Playing politics with people’s lives isn’t new, it’s consequences are just poorly remembered.

Jamie

A little imagery to go with your lowest rung. It’s now out of reach for beginners in the job market.

PaulJ

Why have any minimum wage? Why can’t the government support low paid workers so that owners can increase their profit? Why not move jobs to where corrupt governments structure the market to funnel money to their elites? There is no ladder, the wealthy can give a hand up, or masses can drag their share from cowering princes.

Jamie

Any money you’ve ever spent at Target or Cub, you’ve done so voluntarily because you agreed that the item you were exchanging your money for was worth the same or more than the money you were exchanging it for. Otherwise you’d have walked away and gone without or gone somewhere else for it.

The same applies to jobs and the employer/employee relationship. Once the exchange isn’t worth it for one side of the agreement, that party will walk away. If you’re not paid what you’re worth, go to another employer and convince them that you’re worth more, or start up your own company and become one of your ‘cowering princes.’

Yanotha Twangai

The fallacy in that argument is that it assumes the employer and employee are equally free to take the deal or leave it. The fact is that the employer has most of the power, because it’s usually much more costly for the employee to walk away than it is for the employer. Things like unions, workplace regulations and a minimum wage help equalize the power balance and result in greater fairness.

Rich in Duluth

Jamie
But “free market” thinking doesn’t apply to payment for employment, especially when the job “market” is so limited. If you don’t have enough education or the right education for a higher paying job, you still must make a living or support your family.

Corporations don’t care how employees live or what their standard of living is. They only want the labor employees provide and at the lowest possible cost. Just look a little further than the U.S. border. U.S. corporations are happy to pay foreign workers fifty-cents a day for their labor. It’s government regulation that keeps lowest paid U.S. workers making minimum wage, not the benevolence of corporations. Therefore, it’s appropriate for government to step in and set a minimum wage.

Jamie

Then why aren’t all employers in the US paying only the minimum wage? Why are they paying some employees $50,000, $75,000, $100,000 or more a year? Who is forcing them to do that?

Rich in Duluth

Mike

We’re talking about low paying, unskilled labor. Skilled labor is going to pay more, because there are fewer qualified people out there then there are job openings. In my career in civil engineering, the company was always looking for experienced engineers and technicians, but couldn’t easily find them. This made those jobs more valuable, so the pay was pretty good. I don’t think this is the case with jobs pushing a broom or taking orders at McDonalds.

Jamie

And you’ve just defined the solution. If you don’t want to work for minimum wage, educate yourself in a field that needs people. Three cheers for Rich!!!

Jim G

During the French Revolution when Maria Antoinette was told the poor didn’t have bread, she famously declared in her naivety, “Then let them eat cake.”

Your solution to insufficient minimum wages, could well be summarized by another naive response I’ve heard in this debate, “Then let them be engineers!” This response is just as impossible to achieve for some underemployed, and unemployed workers as eating cake was to a French peasant 225 years ago.

The minimum wage should provide enough money to where it is possible for underemployed, and unemployed workers to at least get a foothold before their begin to retrain themselves and start to compete for the ever shrinking supply of good paying jobs. I suggest that a Polar bear experiencing the effects of global climate change has a better probability of survival than entry level American workers do without a significant increase in the minimum wages. It will give them a fighting chance to compete for good paying jobs as these good jobs continue their global implosion.

Charles

I think it might be shown that there is probably one person out of 100, or even 200, high school grads who goes on and gets employed in an engineering job. Most engineering graduates get positioned as clerks, salespersons, or lower level management. Many companies won’t even offer jobs to anyone with less than a master’s degree. It is a way of creating a filter for too many pursuing too few jobs.

Jim G

My cousin worked 20 years as a contractual electrical engineer for local corporations; 3M, and Control Data pop to mind. However, in the early 2000’s he wasn’t getting work. I found out that he hadn’t graduated from the IT College at the U. He had been one quarter short of his Bachelor of Science, but had worked successfully in contractual positions forever. Eventually, he was forced to go back to the U to finish his degree. Why was he no longer suitable for electrical engineer positions even though he had proven himself quite capable? The answer is corporations started using computer programs to sift through engineers as an easy way to pare down the numbers of engineers applying for increasely fewer positions. There really isn’t a real electrical engineer shortage in the States. There is just the insistence to pay as little as possible for engineers for these jobs that are increasingly outsourced to India. Or, we see corporations bringing in foreign trained engineers willing to work at a lower salaries than their American competition is.

Rich in Duluth

Mike

If you look at my earlier post, you’ll see that I suggest that the minimum wage hike should be coupled with an increase in education funding targeted at good paying jobs. A problem those who oppose a minimum wage increase don’t seem to recognize is that people making minimum wage can just barely afford to live, let alone pay for the education needed to get a really good job. In many cases they work more than one job or are on government assistance. But, I agree with you, the government should be providing job training for these people.

Thanks for the three cheers….why?

PaulJ

It is a 3 party exchange. The third party (gov’t) is in the pocket of the employers. The employees only have uprising to fall back on, the gov’t prevents this by throwing them a bone once in a while. Like in the recent revolutions or in Marx.

I’m in support for a moderate increase in the minimum wage…I disagree with the idea of a minimum wage but if we’re going down the road of raising it then let’s set it to a realistic value (like $8/hr or $8.25/hr) rather than something much larger like $10+/hr.

David

How about a universal basic income instead?
$8/hr – $10.10 seem so arbitrary and submissive to the wims of the one percent.

Mike

Can you define universal basic income for me please? I’m unfamiliar with the term.

Mike

Never mind. My Google’s working just fine. So, the government just pays everybody, rich or poor, a minimum amount for breathing. Do we still have open borders?

David

Yes and yes, we all breathe the same air, all borders are provisional and temporary.

Mike

So, if I hear you correctly, the US Government should pay every person in the world a minimum amount to keep them out of poverty. Governments are also provisional and temporary. Ours has borrowed to the point of near economic collapse. We can either have open borders or we can have a welfare state. We can’t have both. We could have neither, but not both. Your ability to blind yourself to the consequences of such a policy is astounding.

David

I doubt if you “heard” me at all.

The prohibition of the world’s most utilitarian plant is both provisional and temporary, but it has had lasting negative repercussions for economy and ecology. The prohibition has not ended yet, neither has the ignorance of interrelatedness it appears.

Mike

I thought we were talking about economics and state sovereignty. I didn’t know we were talking about staying home and lighting up.

Yes I know there are thousands of other medicinal and fiber uses for hemp, but where did that come from? Better take another hit, dude.

Mike, out.

David

Yes were did that come from? It was know back in the 30’s and long before then. Washington said planted everywhere, Adams said we’ll will want it more and more for our country, Jefferson said hemp is of first necessity to the protection and welfare of our country, the first paper factor Started by Franklin in America made hemp paper etc. … If the people can’t grow then the one percent have the upper hand.

I agree that life is not what it appears nor is it otherwise.

The sovereignty of the people is not to be undermined by the greedy elite nor their dupes and shills.

Ben Groetsch

I would support a higher miniumn wage on one condition: the state needs to regulate commerce with better enforcement rules. This means employers are subject to new laws such as prohibiting age discrimination regarding hiring practices, ending credit checks on potential employees, ending subsidies to companies that don’t provide results on job prospects in the community, incorporate a shareholder transaction tax to any corporation in Minnesota that does trading on Wall Street, have workers the right to form a union, ban companies from dissolving pensions against their retired employees, require companies to give workers equal pay and benefit packages, and make it illegal surrounding favoritism and nepotism in the state workforce.

Gordon near Two Harbors

I suport an increase in the minimum wage, but there should be a two-tiered system. Kids under 18 years old don’t need to have such a high minimum wage, as they are new to the workforce, unskilled, and mostly supported by their parents.
A higher minimum wage is definitely needed for those adults who work full time, but don’t make enough to support their basic needs.
Would you rather have people able to support themselves or depend on support from the government, paid for by the taxpayers?

cas0005

Let’s test that theory put forward by D Brian’s. Worst case is we lose a few jobs that nobody can live on anyway -but experience elsewhere suggests no jobs are lost. Maybe just the opposite

mkwallace13

of course

Bren

Let’s call it a livable wage rather than a minimum wage. I support an increase. The higher earnings increase spending, which in turn increases demand for goods and services and creates jobs. Other countries around the globe introduced higher minimum wages with little impact on jobs.

Sue de Nim

Here’s another idea I like: a true right to work. This would not be the deliberately misnamed union-busting measure, but a guaranteed job for any able-bodied person willing to work, modeled on the WPA. If private business isn’t creating enough jobs, people could earn a minimally dignified living by working on public works projects, tending parks, cleaning public buildings, etc. The minimum wage could be abolished. If you’re willing to work for a private employer at a lower wage than the government is paying, you’d be free to do so, but you’d never have to work for starvation wages if you don’t want to. When business is booming, fewer people would need to rely on the program, but when a recession hits, the program would provide an automatic economic stimulus.

Jim G

I can see the value of this type of program. The WPA not only provided jobs to those without them, it also provided a structure to teach the skills workers need to acquire in order to be successful; communication skills, and how to be a reliable worker. The WPA provided many more examples where the energy of unemployed workers was channeled into productive endeavors and got many of the urban poor out of their neighborhoods for the first time in their lives.

Which Marx

Reading a lot of the replies here, I’m trying to determine who had the most influence on the – Groucho, Harpo, or Karl. I think maybe all three – Grouch, the wise-cracking hustler; Harpo, the clown; and Karl the murdering socialist. No Justice No Peace. Just kill your fellow man until human equality has been
achieved.

Jim G

You’re welcome to join the discussion. There are many divergent views expressed on Today’s Question . You might even learn something you never considered important before. Come on in and join us. Caution: Unfortunately, today the water is FROZEN.

Ashley Wilson

Very much so.

Bright Eyes

Yes, I defer to economists & studies that have demonstrated good results. Set it to $10 where it was 50 years ago in adjusted USD and index it yearly to cost of living increases. This shouldn’t be a trauma every decade to raise it to where it should be.

Charlie

I think wages for guest workers should be set at 150% of minimum wage. It would be similar to paying overtime. It would give our people a chance to compete for the jobs.

ShowMeTheMoney2014

Unless you are a Human Being that is making billions…Its now time to raise the wage!!!

jim

workers need to demand better wages from their employer. the labor movement happened before there was a social safety net. looking to govt. for what we need makes workers complacent and lets the bosses off the hook. middle class consumers need to support labor. for example, no more crossing a picket line to get that cheap air fare.